Stockmanship Journal

Wednesday, February 27, 2013

The Bigger is More Profitable Myth

There is a commonly held opinion within
the cattle industry that ranchers need to raise bigger calves to be
profitable. Is this opinion fact, or is it a myth?

When I checked the market prices at
Amarillo, Texas tonight, 700 pound steers were bringing $145 cwt
while 500 pound steers were bringing $187 cwt. This meant (that at
least on this day) a 500 pound steer was actually worth $65 more than
a 700 pound steer. In reality, that 700 pound steer is costing you
more than the $65 difference in market price per head.

The average amount of feed to maintain
a cow (depending on whether or not she is lactating, and what
trimester of pregnancy she is in) will ranch from 2.5% to 3.5% of her
body weight. For the purpose of keeping the numbers round, I am going
to use an even 3%.

A 1,250 pound cow will have a daily
feed requirement (1250 X 0.03) of 37.5 pounds of feed. This comes
out to 13350 pounds of feed per year to raise that 700 pound calf.

A 700 pound cow will have a daily feed
requirement (700 X 0.03) of 21 pounds a day, which comes out to 7665
pounds of feed per year.

By dividing the difference in the
amount of feed needed to maintain the 1,250 cow by the amount needed
to maintain the 700 pound cow, we find that you can actually run 1.78
of the 700 pound cows on the same amount of forage as it takes to
run one 1,250 pound cow. This equates to running 178 cows raising 500
pound calves on the same amount of forage as it takes to run 100 of
those soggy 700 pound calves. So just how much more money can your
ranch bring in with the more moderately framed cows?

Based on the above market prices, you
will make $6,500 more per 100 calves on those 500 pound calves.
However when you add the additional 78 calves you would raise, this
adds another $72,930 which brings the total to $79,430. When you take
into account the extra vaccines and wormers you will need, the total
will drop a little, but you would still be putting more than $70,000
a year into your bank account on the same amount of feed and forage.

About Me

I have been involved with cattle since I was a young child. Since 1972 I have spent the majority of the time working ranches and feedlots across the west. I am available for consulting or training in reduced stress cattle handling. If you are following a rotational grazing program I can show you how to make it more efficient by herding and eliminating interior fences. Feel free to comment or contact me with your questions!